Market Opportunity The Euro, Germany’s unit of currency, remains very strong against the US dollar, creating increased demand for US goods. Germany is one of the most lucrative and appealing markets in Europe, with the largest population in the European Union, at 82.4 million, and the largest economy in the entire region. Additionally, a recent press release from prnewswire.co.uk finds that Germany is Europe’s largest consumer market, whose national purchasing power accounts for about 20% of all of Europe. The average disposable income in Germany is about $29,000, only slightly lower than the $30,000 mean disposable income in the US. And this figure is expected to increase in the coming years. According to a survey by the GFK Group, German consumers will have an average of $1,000 more income to spend in 2008 than the previous year as incomes tend upwards on average. Despite the impressive promise of the German market to a perspective exporter, there remain challenges. Similar to many countries in continental Europe, unemployment remains high in Germany (consistently above 9%). Also, the size of the middle class in Germany has begun to shrink slightly, with the Macroeconomic Policy Institute in Germany (IMK) declaring its size to have decreased by about 5 million since 1992. Like other EU countries, the current German administration to addressing these issues in an effort to continue increasing the overall growth of the economy.

Best Industry Segments While the German economy thrives on its ability to export abroad, there is much opportunity to enter several profitable import markets. Germany’s primary worldwide imports include petroleum products, manufactured goods, electrical products, and apparel. A US firm seeking to break into the German market may find it promising that the US is Germany’s second largest trading partner, with exports expected at about $71 billion in 2008. Electrical equipment, aircraft, telecommunications products, data processing, and motor vehicles and parts rank among the most prominent US exports to Germany.

Regulation and Tariff Climate According to The US Department of Commerce Germany’s regulations and bureaucratic procedures may prove to be a challenge for some companies wishing to enter the market, and thus require close attention from US exporters. Regulatory measures such as safety standards and CE marks are required for many manufactured products, and firms should discover which standards apply and how to obtain timely testing and certification to meet them. The European Union is already one of the most open to trade in the world, with an average level of customs duty protection at around 4% on industrial goods. And things seem to be improving further in this arena, as the US and the EU, under the leadership of German Chancellor Merkel, have been working on a proposal for a Transatlantic Economic Council designed to further knock down regulatory barriers and tariffs between the US and the European Union.

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